Team Value

[Section 101]

So the Hornets just sold. Which is a good reference point for the Kings value.

On Forbes valuation as of Jan 25, 2012 the Kings were #23 at $300 million, the Hornets #24 at $285 million.

The Hornets just sold for $338 million.

So guestimating the Kings value at around $350-$375?

 

[ElRey]

Maloofs have said they aren't going to sell. The Maloofs are stubborn and stupid. They want to maintain their playboy lifestyles and be in the bright lights, even though they are in serious debt. Wish Burkle or someone would give them an offer they can't refuse, and then the Maloofs can to Anaheim and do whatever they want, and get out of our lives.

 

[Capt. Factorial]

Total debt to the City of Sacramento: $70M
Total debt to the NBA: $100M (rumored)
Number of wins this season: 19
Number of fans that hate the owners: 2,453,559

Value of team? Worthless.

 

[LWP777]

Total debt to the City of Sacramento: $70M
Total debt to the NBA: $100M (rumored)
Number of wins this season: 19
Number of fans that hate the owners: 2,453,559

Value of team? Worthless.

So if they owe ~ $170M and the Kings can be sold for ~ $375M WTF can't they just take the change and go away somewhere else. They can't afford to run a basketball team because typically they don't produce a lot of cash flow.

 

[bajaden]

So if they owe ~ $170M and the Kings can be sold for ~ $375M WTF can't they just take the change and go away somewhere else. They can't afford to run a basketball team because typically they don't produce a lot of cash flow.

I really think these guys are between a rock and a hard place. I don't know about you, but I thought George almost looked like a desperate lunatic at the press conference. It would have been comical at times if it wern't for the topic.

 

[ElRey]

So if they owe ~ $170M and the Kings can be sold for ~ $375M WTF can't they just take the change and go away somewhere else. They can't afford to run a basketball team because typically they don't produce a lot of cash flow.

It would make all the sense for them to sell the team and live off what's left of their daddy's empire, but this is the Maloofs we're talking about here. They love the fame and holding onto that for dear life. Without the Kings, they just go back to being no name millionaires.

 

[ArcoKings]

So if they owe ~ $170M and the Kings can be sold for ~ $375M WTF can't they just take the change and go away somewhere else. They can't afford to run a basketball team because typically they don't produce a lot of cash flow.

There's $205 million left assuming these figures are correct. Don't you have to also add what the Maloofs paid for the team? Also, they aren't 100% owners of the team. I doubt there's money left (profit) after they sell.

 

[Capt. Factorial]

There's $205 million left assuming these figures are correct. Don't you have to also add what the Maloofs paid for the team? Also, they aren't 100% owners of the team. I doubt there's money left (profit) after they sell.

Yeah, they only own a little over 50%. Something like 52%, but I'm not sure exactly. Of course, from a serious (rather than flippant) point of view, that debt would presumably remain with the team if they sold. So they wouldn't have to pay if off. But the mere existence of the debt would drive the buying price down.

 

[OnYouLikeGlue]

There's $205 million left assuming these figures are correct. Don't you have to also add what the Maloofs paid for the team? Also, they aren't 100% owners of the team. I doubt there's money left (profit) after they sell.

Which is why I think their ultimate goal has always been Anaheim. It would instantly increase the value of the team, plus they already have a buyer in Samueli who I'm sure they already have some kind of arrangement with to forgive some of the debts. Making their ultimate profit much higher.

Seems like they had no intentions of staying here and getting a new arena done.

 

[jalfa]

Which is why I think their ultimate goal has always been Anaheim. It would instantly increase the value of the team, plus they already have a buyer in Samuelli who I'm sure they already have some kind of arrangement with to forgive some of the debts. Making their ultimate profit much higher.

Seems like they had no intentions of staying here and getting a new arena done.

however, in that case they have Buss and Sterling levying a massive relocation fee on them for messing with their backyard, probably to the extent that it cannot be profitable to move there. something in the relationship with Samueli is seriously shady, he seems to wield far too much power over them.

 

[Arkitect]

If they leave, they could also possibly drop the 70 million on the city.

 

[Purple Reign]

http://www.ocregister.com/sports/deal-349147-sacramento-nba.html#

Anaheim officials said they are not communicating with the NBA at this point but remain ready for and optimistic that they'll get an NBA team.

Councilwoman Lorri Galloway said she had spoken recently with Kings’ co-owner George Maloof, and “I personally reminded him that Anaheim wouldn’t charge any pre-development fees.”

 

[Tetsujin]

If they leave, they could also possibly drop the 70 million on the city.

DOn't even think they have the money for that, it seems.

 

[VF21]

http://www.ocregister.com/sports/deal-349147-sacramento-nba.html#

Anaheim officials said they are not communicating with the NBA at this point but remain ready for and optimistic that they'll get an NBA team.

Councilwoman Lorri Galloway said she had spoken recently with Kings’ co-owner George Maloof, and “I personally reminded him that Anaheim wouldn’t charge any pre-development fees.”

Yep. No surprise there. Anaheim and George Maloof. Nothing but class.

 

[JB_kings]

If they leave, they could also possibly drop the 70 million on the city.

Not on this city they won't. They will just default on the arena and wave bye-bye. They've already don't care about their reputation or image. It's hit an all time low. The only people who seem to think the boys are cool are either on their payroll or think they have a good shot at watching Anaheim Royals games this fall.

 

[bluntsnbball]

at this point, how certain are you guys that stern and the rest of the owners will even let the kings move? It seemed that we had the bulk of the owners on our side for this whole thing, including clay bennet (or at least it sounds like theyre all on our side). The maloofs wanna move, fine, but do you guys think that maybe, just maybe, theyve burned too many bridges during this whole process and aside from that, KJ has shown that Sac is not only worthy of a team but DESERVES this team.

I think this battle is far from over folks. Call me optimistic, but i think theres a solid chance that we arent the only ones fed up with the maloofs, and if they attempt another relocation and get turned down AGAIN, then i think theres almost no way they wont sell the team b/c theyve already pissed off the whole city and if they arent even welcome in their own arena and they cant leave, i think some good things may come.

On the bright side, if the kings do leave, this drama is over and we will never have to deal with this maloof BS ever again.

 

[ParniValjak]

I have mentioned this before but the Maloofs own approximately 52% of the Kings which is enough to make them dangerous slimebags as we have experienced. They owe Sacramento ~ $70 million and are rumoured to have taken ~ $100 million loan from the NBA which adds up to approximately $170 million of debt!

Now add to that that the overall worth of the team would be around $330-340 million and you realise they are levereged to the max on this one. They can sell their share which would be worth around $170 million but if you take into the account the debt, crappy TV deal and inadequate facilities that figure would go down SIGNIFICANTLY! So lets say it's around $100 million they could get for their share, that still is not enough for them. They need more so the only way out for them is to relocate to a market where the overall value of the franchise would increase and in the process they also dump the $70 million debt on to Sacramento. So in essence the value of the Kings goes from around $330-340 million to some $400 million and the debt goes from $170 million down to $100 million.

Except what they did was burn their bridges with the NBA so there is no way in hell NBA approves their relocation request. So their plan is to either sit this one out for a while and hope the NBA firgets and they relocate in a year or two, or they get desperate and go down the path of anti trust lawsuit against the NBA! They are desperate enough and stupid enough to do it but I am not sure they can afford it!

I think they are between a rock and a hard place and their egos are writing cheques that their business acumen can't bank! IMHO, this is the official beginning of the end for Maloofs as owners of the NBA team.

The people of Sacramento have to be really smart about this and simply cannot afford to go down the path of Charlotte fans and get into a pissing contest with ownership! Maloofs will fall on their own sword here just give them time. In 2 years max they are no longer the owners of this team. Bookmark it!

Unfortunately the will be pain for us as they will further cut costs and lose franchise cornerstones because they can't afford to pay them but they will fold! I have no doubts about this!

They will be flipping burgers soon!

 

[VF21]

I have mentioned this before but the Maloofs own approximately 52% of the Kings which is enough to make them dangerous slimebags as we have experienced. They owe Sacramento ~ $70 million and are rumoured to have taken ~ $100 million loan from the NBA which adds up to approximately $170 million of debt!

Now add to that that the overall worth of the team would be around $330-340 million and you realise they are levereged to the max on this one. They can sell their share which would be worth around $170 million but if you take into the account the debt, crappy TV deal and inadequate facilities that figure would go down SIGNIFICANTLY! So lets say it's around $100 million they could get for their share, that still is not enough for them. They need more so the only way out for them is to relocate to a market where the overall value of the franchise would increase and in the process they also dump the $70 million debt on to Sacramento. So in essence the value of the Kings goes from around $330-340 million to some $400 million and the debt goes from $170 million down to $100 million.

Except what they did was burn their bridges with the NBA so there is no way in hell NBA approves their relocation request. So their plan is to either sit this one out for a while and hope the NBA firgets and they relocate in a year or two, or they get desperate and go down the path of anti trust lawsuit against the NBA! They are desperate enough and stupid enough to do it but I am not sure they can afford it!

I think they are between a rock and a hard place and their egos are writing cheques that their business acumen can't bank! IMHO, this is the official beginning of the end for Maloofs as owners of the NBA team.

The people of Sacramento have to be really smart about this and simply cannot afford to go down the path of Charlotte fans and get into a pissing contest with ownership! Maloofs will fall on their own sword here just give them time. In 2 years max they are no longer the owners of this team. Bookmark it!

Unfortunately the will be pain for us as they will further cut costs and lose franchise cornerstones because they can't afford to pay them but they will fold! I have no doubts about this!

They will be flipping burgers soon!

Nice post. I especially liked the paraphrase of one of my favorite lines from "Top Gun."

 

[JB_kings]

I agree that for them it is Anaheim. But I don't think their actions show they are a sit tight and wait mode. They appear like they are ready to challenge the NBA with antitrust and move anyway this summer without approval. They will let the courts decide and probably take years to do so. Where I think Sacramento and the NBA might hold the trump card, is if they can win a temporary injunction to keep them in Sacramento pending a decision. I'm not a lawyer, so it's just my humble read of where I think this is headed based on how the parties are reacting.

 

[Section 101]

I agree that for them it is Anaheim. But I don't think their actions show they are a sit tight and wait mode. They appear like they are ready to challenge the NBA with antitrust and move anyway this summer without approval. They will let the courts decide and probably take years to do so. Where I think Sacramento and the NBA might hold the trump card, is if they can win a temporary injunction to keep them in Sacramento pending a decision. I'm not a lawyer, so it's just my humble read of where I think this is headed based on how the parties are reacting.

You can bet Steinberg would jump in too. I'm waiting for him to come up with something that will really screw anahiem if they decide to relocate.

 

[VF21]

I agree that for them it is Anaheim. But I don't think their actions show they are a sit tight and wait mode. They appear like they are ready to challenge the NBA with antitrust and move anyway this summer without approval. They will let the courts decide and probably take years to do so. Where I think Sacramento and the NBA might hold the trump card, is if they can win a temporary injunction to keep them in Sacramento pending a decision. I'm not a lawyer, so it's just my humble read of where I think this is headed based on how the parties are reacting.

One thought? If they ignore the BOG and move the team, does the NBA have to include them in their schedule of sanctioned games? It would be pretty ironic if they went to Anaheim only to find the NBA front office had retaliated by refusing to allow any of their law-abiding franchisees to play them.

 

[macadocious]

One thought? If they ignore the BOG and move the team, does the NBA have to include them in their schedule of sanctioned games? It would be pretty ironic if they went to Anaheim only to find the NBA front office had retaliated by refusing to allow any of their law-abiding franchisees to play them.

There is ZERO chance Stern allows this to go down this way. His inclusion of the anti-trust term in referring to the attorneys and saying some of his best friends are anti-trust attorneys was a warning shot.

He will not allow them to set a precedent in the league. What Sterling did is not the same thing. Different time and different place.

I also don't believe the Maloofs have the ability to pick the lawyers best suited for something like this.

 

[VF21]

There is ZERO chance Stern allows this to go down this way. His inclusion of the anti-trust term in referring to the attorneys and saying some of his best friends are anti-trust attorneys was a warning shot.

He will not allow them to set a precedent in the league. What Sterling did is not the same thing. Different time and different place.

I also don't believe the Maloofs have the ability to pick the lawyers best suited for something like this.

Oh, believe me - we're on the same page on that. I was just playing worst-case scenario. I wonder if the NBA now has some provision for legally franchised teams as opposed to mavericks, especially because of the Sterling situation.

 

[Tetsujin]

One thought? If they ignore the BOG and move the team, does the NBA have to include them in their schedule of sanctioned games? It would be pretty ironic if they went to Anaheim only to find the NBA front office had retaliated by refusing to allow any of their law-abiding franchisees to play them.

Maloofs move to Anaheim, Stern decides not to include them in NBA schedule. Their empty slot goes to new locally-( or Burkle-)owned expansion team in Sacramento located in new ESC since it's considerably harder to schedule for 29 teams than it is for 30. Maloofs fold. We get our players back. Everyone is happy (Well, except the Maloofs but they can burn in hell for all I care).

 

[VF21]

Maloofs move to Anaheim, Stern decides not to include them in NBA schedule. Their empty slot goes to new locally-( or Burkle-)owned expansion team in Sacramento located in new ESC since it's considerably harder to schedule for 29 teams than it is for 30. Maloofs fold. We get our players back. Everyone is happy (Well, except the Maloofs but they can burn in hell for all I care).

See, that's what I'm talking about.

 

[Sactown ExPat]

I think that a deal will be struck when the NBA and city loans are forgiven, or mostly forgiven, and the Maloofs walk away with $100M-$150M. It will be a Pyrrhic victory. They spit in the face of a future governor of California and his powerful friends in addition to Stern, the other owners, and the league's partners.

 

[VF21]

I think that a deal will be struck when the NBA and city loans are forgiven, or mostly forgiven, and the Maloofs walk away with $100M-$150M. It will be a Pyrrhic victory. They spit in the face of a future governor of California and his powerful friends in addition to Stern, the other owners, and the league's partners.

The City Council will not approve forgiving any part of the loan. The loan repayment was a frequent topic of conversation at the council meetings and it was clear a majority of the board would not support anything that impacted the repayment of the loan to the city.

 

[Warhawk]

The City Council will not approve forgiving any part of the loan. The loan repayment was a frequent topic of conversation at the council meetings and it was clear a majority of the board would not support anything that impacted the repayment of the loan to the city.

Nor should they!

 

[JB_kings]

Gotta remember George doesn't think like a savvy business man. Him and the rest of the crew are still emotionally in their teen age years. This is not some put down. I think they are reckless and extremely self centered. Nearly every decision is driven off some emotion that remains unchecked. Gavin truly does have tears of joy for staying and George really is an angry and vengeful bully in all aspects. And the mood swings are just as wild. It's also why the joy and good deal feelings after Orlando lasted a very short time. And in all things, it's gamble on the big break.

Which brings me to the current situation. George calls all the shots because he is the "smaht one". For him keeping the team here made no sense. He has to set himself up for the big score. In his eyes, that is Anaheim and the big market. Can't sell the team here because the debt ratio is going to net them a seriously low amount of money. If not being totally upside down in the deal. So every decision he makes is to set the team up to move. They don't look like they are wise moves, but again, they don't do things that way. So in his head, he thinks that he can do all this and it's totally worth the risk. And worse case scenario for him is to underestimate Stern's ability and resolve and be forced to stay here and wind up having to sell the team. It's a gamble for them, but big payout if they win the battle. But George's weakness in thinking is that he guesses other players moves as if he was the one doing them. Which is based on emotion rather than logic.

Funny thing is, his logic might be right because they went so deep into debt and doing this arena deal would sink them even deeper, he has zero choice. They made their own bed.